Matching Cost Against Revenue at Royalty Expenses

The recording of royalty expenses must not only be consistent but also complied with the principle of matching costs against revenue, especially in calculating taxable income. If all accounting principles are not met in recording the royalty expense, the tax authority will correct it so that the royalty expenses cannot be deducted from taxable income. By using a case in a tax court in Indonesia, there is a taxpayer who does not meet the matching cost against revenue principle when recording royalty expenses. The taxpayer deducts these royalty expenses for the previous year in the current year because the amounts of these royalty expenses are known exactly in the current year. Even though the taxpayer's financial statements were audited and had an unqualified opinion, the Directorate General of Taxes (DGT) as the tax authority in Indonesia negated the royalty expenses as a deduction from taxable income. This paper finds that a net sales-based royalty fee scheme can be estimated at the end of the year and deducted from gross income without waiting for a certainty on the amount of royalty expense on invoices received in the coming year. The accounting records of the taxpayer are not proper so that some data or documents cannot be proven in the tax court. The method of recording in the financial statements with an unqualified opinion does not guarantee that the recording follows tax regulations, especially following Generally Accepted Accounting Principles (GAAP).

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U.S. Gaap—A U.K. Actuary's Perspective.

Journal of the Staple Inn Actuarial Society ◽

10.1017/s0020269x00009142 ◽

1979 ◽

Vol 23 ◽

pp. 125-180

Author(s):

S. Creedon

Keyword(s):

Life Insurance ◽

Financial Statements ◽

Insurance Companies ◽

Certified Public Accountant ◽

Certified Public Accountants ◽

American Institute ◽

Generally Accepted Accounting Principles ◽

Accounting Principles ◽

The U.S ◽

Public Accountant

Unlike his U.K. counterpart, who opines on a ‘true and fair view’, the more limited objective of the U.S. Certified Public Accountant is to certify that financial statements present fairly ‘in conformity with generally accepted accounting principles’. Generally accepted accounting principles, as applicable to proprietary life insurance companies, are set out in the American Institute of Certified Public Accountants Audit Guide ‘Audits of Stock Life Insurance Companies’ (1) (hereafter referred to as the ‘Audit Guide’). Despite being neither general in application nor universally accepted, it is these accounting principles which are commonly known as U.S. GAAP.U.S. GAAP are relevant to U.K. actuaries because:(a) Many actuaries work for, or with, life insurance subsidiaries of U.S. companies which are required to prepare financial statements in accordance with U.S. GAAP(b) More generally, on the grounds that developments in the U.S. often precede similar developments in the U.K., we should anticipate the possible development of U.K. generally accepted accounting principles (or even EEC GAAP).

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Analisis Penyajian laporan Keuangan Koperasi Syariah BMT Al-Ittihad Pekanbaru

Al-Hikmah Jurnal Agama dan Ilmu Pengetahuan ◽

10.25299/jaip.2019.vol16(1).2869 ◽

2019 ◽

Vol 16 (1) ◽

pp. 1-22

Author(s):

Zulkifli Zulkifli ◽

Boy Syamsul Bakhri ◽

Rahmawati Rahmawati

Keyword(s):

Descriptive Analysis ◽

Accounting Standards ◽

Financial Statements ◽

Financial Accounting ◽

Financial Statement ◽

Research Subject ◽

Generally Accepted Accounting Principles ◽

Descriptive Research ◽

Accounting Principles

Accounting standards is fundamental in the preparation of financial statements that must be referred to each company. Accounting standards that form these statement codified in a book called financial accounting standards (GAAP). The book contains a collection of statement of financial accounting standards (SFAS). This study aims to determine the extent of the financial statement presetations of BMT Al-Ittihad in applying generally accepted accounting principles in particular SFAS No.101. This research is a comparative descriptive research that describes, explains and compares the financial statements of BMT with SFAS 101. The research subject is a sharia cooperative BMT Al-Ittihad Pekanbaru while the object is to report RAT BMT Al-Ittihad Pekanbaru. Data were collected by interview and documentations. The analisis is comparative descriptive analysis, which compares the data that has been collected by the relevant theories to draw a conclusion. Based on the results, itshow that the financial statements of BMT Al-Ittihad has not fully adopted SFAS No.101, because: 1) it does not present a statement of sources and uses of zakah, 2) it does not present a statement of sources and uses of charity fund, 3) it does not present a note to the financial statements, 4) it does not present informations of preparations of financial statements and the accounting polices used, and it does not to disclose information required under SFAS No.101.

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ANALISIS PENERAPAN AKUNTANSI PADA USAHA EKONOMI DESA SIMPAN PINJAM (UED-SP) PERMAI DESA SUNGAI CINGAM KECAMATAN RUPAT KABUPATEN BENGKALIS

Inovbiz: Jurnal Inovasi Bisnis ◽

10.35314/inovbiz.v4i1.32 ◽

2016 ◽

Vol 4 (1) ◽

pp. 20

Author(s):

Hazima Hazima ◽

Rosmida Rosmida ◽

Wan Junita Raflah

Keyword(s):

Service Life ◽

Cash Flow ◽

Secondary Data ◽

Financial Statements ◽

Short Term ◽

Generally Accepted Accounting Principles ◽

Accounting Principles ◽

Fixed Assets

Abstract: This research was conducted in UED-SP Permai Sungai Cingam Rupat, District of Bengkalis. The purpose of this study was to determine whether the accounting has been applied in UED-SP Permai Sungai Cingam Rupat, District of Bengkalis in accordance with the Generally Accepted Accounting Principles (GAAP). Data of study consisted of primary and secondary data. Based on the research and discussion conducted found some problems such as is not classify assets into current assets and fixed assets, does not classify debts into long-term debt and short-term debt and in calculating the inventory usage is not in accordance with the service life should be. In the process of implementation of the financial statements UED-SP Permai Sungai Cingam Rupat, District of Bengkalis is not follow all the Accounting Cycle, UED-SP Permai is not present Statement of Changes in Equity, Statement of Cash Flow, and Notes to Financial Statements. The results of research conducted on Usaha Ekonomi Desa-Simpan Pinjam (UED-SP) Permai can be concluded that the accounting is not applied on the whole in accordance with the Generally Accepted Accounting Principles (GAAP). Keywords: Financial Statements, UED-SP Sungai Cingam

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PENERAPAN ISAK 35 PADA MASJID BAITUL HIDAYAH PUGER JEMBER

Progress: Jurnal Pendidikan, Akuntansi dan Keuangan ◽

10.47080/progress.v4i2.1286 ◽

2021 ◽

Vol 4 (2) ◽

pp. 152-162

Author(s):

Ismi Darojatul Ula ◽

Moh Halim ◽

Ari Sita Nastiti

Keyword(s):

Data Collection ◽

Financial Reporting ◽

Descriptive Analysis ◽

Financial Statements ◽

Generally Accepted Accounting Principles ◽

Accounting Principles ◽

Analysis Technique ◽

Qualitative Descriptive ◽

Net Assets ◽

Using Data

The purpose of this study was to determine the suitability of financial statements according to ISAK No. 35 and how the accounting record in the financial statements of Baitul Hidayah Puger Mosque with generally accepted accounting principles. The research was conducted at the Baitul Hidayah Puger Mosque using data collection techniques with interviews and documentation. The data analysis technique in this research was a qualitative descriptive analysis where the data was compiled and described based on the result of data collection on financial statements, then was compared with relevant theories to the problem, which could then be drawn a conclusion. Based on the result of the study, it could be concluded that the basis of recording applied at the Baitul Hidayah Puger Mosque was incomplete and not sequential according to applicable standards. The financial statements that made a report, a report on changes in net assets, a cash flow statements and notes on financial statements. Implementation of ISAK No. 35 Baitul Hidayah Puger Mosque was not in accordance with generally accepted accounting principles. The financial reporting of the Baitul Hidayah Mosque in Puger was not in accepted accounting principles.

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Good Intentions at Good Grains, Inc.

Issues in Accounting Education ◽

10.2308/iace-50296 ◽

2012 ◽

Vol 28 (1) ◽

pp. 115-129 ◽

Cited By ~ 1

Author(s):

Susan B. Hughes ◽

Cathy Beaudoin ◽

Russell R. Boedeker

Keyword(s):

Financial Reporting ◽

Financial Statements ◽

External Pressure ◽

Financial Accounting ◽

Managerial Accounting ◽

Ethical Considerations ◽

Generally Accepted Accounting Principles ◽

Financial Reporting Standards ◽

Gray Area ◽

Accounting Principles

ABSTRACT: This case addresses the “gray” area associated with the use of accounting discretion as it relates to expense line item reclassifications. Such a context allows for an examination of the pressures that influence accounting decisions, and provides a glimpse into how managers might manage reported expenses. The reader meets analyst David Johnson when, as a result of both internal and external pressure to keep research and development (R&D) costs within budget, he is asked to find ways to reclassify R&D costs into other expense areas. As a result of the request, David immerses himself in the task in order to identify, within generally accepted accounting principles (GAAP), opportunities to reclassify R&D expenses to cost of goods sold. He ultimately proposes three separate reclassification entries that, although technically within GAAP guidelines, involve the use of accounting discretion. All three entries are approved by the accounting team. Financial accounting, managerial accounting, and M.B.A. students report that the case enhanced their knowledge of financial reporting and helped them understand ethical considerations associated with the preparation of financial statements. Accounting professionals report the case realistically depicts what accountants face in the workplace. A case extension using International Financial Reporting Standards (IFRS) is also provided.

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Home Heaters: A Holistic View of the Financial Statements

Issues in Accounting Education ◽

10.2308/iace-50053 ◽

2011 ◽

Vol 26 (4) ◽

pp. 797-806 ◽

Cited By ~ 4

Author(s):

M. Cathy Claiborne ◽

Kirkland A. Wilcox

Keyword(s):

Financial Statements ◽

Financial Information ◽

Holistic View ◽

Generally Accepted Accounting Principles ◽

Accounting Principles ◽

Start Up

ABSTRACT In this case, two start-up companies in the same industry have identical economic transactions. Although both companies follow generally accepted accounting principles (GAAP), each manager makes different choices and estimates when applying GAAP. By preparing the financial statements, calculating ratios, and comparing and contrasting the two companies, students see how choices and estimates made by management affect the financial statements. They also see the challenge faced by users of financial information when trying to interpret the financial statements and compare companies. Students really experience an “aha!” moment while analyzing this case. The case refutes their commonly held assumptions that accounting always has a right answer and that financial statements represent the truth.

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Bond Accounting

Debt Markets and Investments ◽

10.1093/oso/9780190877439.003.0030 ◽

2019 ◽

pp. 567-598

Author(s):

Oluwaseyi Adebayo Awoga

Keyword(s):

Monetary Policy ◽

Interest Rate ◽

Capital Markets ◽

Financial Statements ◽

Generally Accepted Accounting Principles ◽

Interest Rate Derivatives ◽

Disclosure Requirements ◽

Accounting Principles ◽

Policy Objectives ◽

Fiscal And Monetary Policy

Bonds play an important role in capital markets and in shaping micro- and macroeconomic activities designed to meet a government’s fiscal and monetary policy objectives. Yet many accounting and finance professionals and practitioners do not fully understand how to properly record and report bond transactions on financial statements. Therefore, this chapter discusses the accounting and disclosure requirements for bond instruments to help bridge this knowledge gap. The chapter begins by reviewing the relevant bond accounting literature, generally accepted accounting principles (GAAP), and fundamental terminologies such as amortization, effective interest rate, derivatives, and valuation. Finally, examples illustrate some bond accounting problems from both asset and liability perspectives.

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5. International differences and standardization

10.1093/actrade/9780199684311.003.0005 ◽

2014 ◽

Author(s):

Christopher Nobes

Keyword(s):

Financial Reporting ◽

Accounting Information ◽

Financial Statements ◽

Generally Accepted Accounting Principles ◽

International Differences ◽

Financial Reporting Standards ◽

Accounting Principles ◽

Accounting Numbers ◽

Accounting Rules ◽

Us Gaap

Just how different can accounting numbers be for the same company under different accounting rules? Which countries use International Financial Reporting Standards (IFRS)? In what main ways is US ‘generally accepted accounting principles’ (US GAAP) different from IFRS? How have politics and economics affected accounting? ‘International differences and standardization’ shows how international standardization simplifies the preparation of financial statements covering whole international groups and how it improves the comparability of the accounting information for managers and investors. Differences between US GAAP and IFRS are considered: US GAAP is more detailed than IFRS and tends to be written in terms of rules rather than principles. It also has fewer options.

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Analyst Following and Forecast Accuracy After Eliminating the 20-F Reconciliation Between IFRS and U.S. GAAP

Journal of Accounting Auditing & Finance ◽

10.1177/0148558x20944641 ◽

2020 ◽

pp. 0148558X2094464

Author(s):

Wen Li ◽

Huai Zhang

Keyword(s):

Financial Reporting ◽

Financial Analysts ◽

Forecast Accuracy ◽

Financial Statements ◽

Securities And Exchange Commission ◽

Analyst Following ◽

Analyst Coverage ◽

Generally Accepted Accounting Principles ◽

Financial Reporting Standards ◽

Accounting Principles

In 2007, the U.S. Securities and Exchange Commission (SEC) decided to allow foreign private issuers to file financial statements prepared according to International Financial Reporting Standards (IFRS) without reconciliation to U.S. Generally Accepted Accounting Principles (GAAP). Using a sample of foreign private issuers from 35 countries/regions during the period of 2005 to 2008, this article investigates how the elimination of the 20-F reconciliation affects financial analysts. We find that it significantly reduces analyst coverage but has no impact on forecast accuracy. We show that analysts who are greatly affected are more likely to terminate their coverage of IFRS firms after the SEC’s rule than other analysts. In addition, we hypothesize and find that eliminating the 20-F reconciliation has a greater impact on firms whose 20-F reconciliation is more useful to analysts. For these firms, the elimination of the 20-F reconciliation significantly reduces both analyst coverage and forecast accuracy. Overall, our results suggest that the elimination of the 20-F reconciliation imposes costs on financial analysts.

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The Impact of IFRS Adoption on Canadian Firms’ Disclosure Levels

International Journal of Accounting and Financial Reporting ◽

10.5296/ijafr.v7i1.11136 ◽

2017 ◽

Vol 7 (1) ◽

pp. 227 ◽

Cited By ~ 1

Author(s):

Essafi El Mahjoub ◽

Saidatou Dicko

Keyword(s):

Random Sample ◽

Positive Impact ◽

Composite Index ◽

Financial Statements ◽

Generally Accepted Accounting Principles ◽

Amount Of Information ◽

Ifrs Adoption ◽

Accounting Principles ◽

The Impact

This study examines a random sample of Canadian firms listed on the S&P/TSX Composite Index to find out whether disclosures in IFRS financial statements increased compared to disclosures based on the former Canadian generally accepted accounting principles. Results show that IFRS adoption has had a positive impact on the amount of information disclosed in financial statements. We conclude that disclosure levels in financial statements based on IFRS are much higher than formerly under Canadian GAAP.

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